Product Grouping vs Function Grouping. Реферат. Менеджмент.
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Good morning, ladies and gentlemen!
Today we’ll discuss the problem that often appears towards the manager. This is
a problem of organizational choice or how to group product activities by
product or by function. In other words, should all specialists in a given
function be grouped under a common boss, regardless of differences in products
they are involved in, or should the various functional specialists working on a
single product be grouped together under the same superior.
But the aim of
our presentation is not to persuade you that only one way is the right and only
this way should be used in each organization. We’ll try to show you that each
reorganization is temporary and manager always have to find some middle
positions between that two ways of organization, he have to find some
compromise. Another point I’d like to underline that all our presentation will
be told from the behavioral scientist’s viewpoint.
So, during our
presentation we’ll offer you some elements to consider, then we’ll talk about
behaviorist’s findings on that matter and consider the example with two plants.
After that we’ll summarize all our presentation and maybe give some useful
advice for managers.
If that clear let me begin
our presentation.
First of all
we have to understand what makes those issues so difficult. It is useful to
review all the criteria often relied on during making decisions. Typically,
managers have used technical and economic criteria. For example, they may ask
themselves “Which choice will minimize payroll costs?” or “Which will best
utilize equipment and specialists. This approach shows us the real logic of
traditional management and has strong support from classical school of
organizational theory. The classical school theorists suggested that the
manager should make the choice based on the following three criteria:
·
Which
approach permits maximum use of special technical knowledge?
·
Which
provides the most efficient utilization of machinery and equipment?
·
Which
provides the best hope of obtaining the required control and coordination?
As you can see there is nothing wrong with these criteria, but they
fail to recognize the complex set of trade-offs involved in these decisions,
cause managers often make changes that produce unanticipated results and even
reduce the effectiveness of organization. For example there is an organization
which few years ago shifted from a product basis to a functional basis. The
reason was that it would lead to improved control of production costs and
efficiencies in production and marketing. While the organization did
accomplished these aims, it found itself less able to obtain coordination among
its local sales and production units.
This example pinpoints the major trade-off that the traditional
criteria omit. Developing highly specialized functional units makes it
difficult to achieve coordination or integration among these units. On the
other hand, having product units as the basis for organization promotes
collaboration between specialists, but the functional specialists feel less identification
with functional goals.
Now lets turn to another point of view. Behaviorists’ recent studies
highlighted three other important factors about specialization and
coordination. They are:
Lets talk about these three factors in more detail. First, differentiation ,
which simply means the differences in behavior and thought pattern that develop
among different specialists in relation to their respective tasks. Differentiation
is necessary for functional specialists to perform their jobs effectively.
Differentiation is closely related to achievement of coordination ,
or what behavioral scientists call integration. This means the collaboration
between specialized units or individuals.
While achievement of both differentiation and integration is possible,
it can occur only when well-developed means of communication among
specialists exist in the organization and when the specialists are effective in
resolving the inevitable cross-functional conflicts.
These recent behaviorists studies point to the following three
questions that managers must consider when they choose between a product or
functional basis of organization.
1.
How will the choice affect differentiation among
specialists?
2.
How does the decision affect the prospects of
accomplishing integration?
There appears to be a connection between the appropriate extent of
differentiation and integration and the organization’s effectiveness in
accomplishing its economic goals. What the appropriate pattern is depends on
the nature of external factors – markets, technology and so on – facing the
organization, as well as the goals themselves. The question of how the
organizational pattern will affect individuals members is equally complex.
Management must consider how much stress will be associated with a certain
pattern and whether such stress should be a serious concern.
To explore in more detail the significance of modern approaches to
organizational structuring, we shall describe one recent study conducted in two
manufacturing plants – one organized by product , the other on a
functional basis .
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